Water firms that spill sewage will not get top rating used to justify CEO pay

Sewage-spilling water companies will no longer be able to justify high chief executive pay by getting "top marks" in the Environment Agency's rankings, under plans to tighten rules, the Guardian understands.

- Helena Horton

Bosses of companies found to "recklessly" discharge sewage have been able to justify their large pay packets because of being awarded the top rating, while companies that preside over sewage spills can still call themselves "industry leaders".

The regulator gives each firm a star rating each year. One star is the lowest mark and means the company is urgently in need of improvement, while the highest mark is four stars, which comes with the accolade of being an "industry leader”.

Companies are judged on seven metrics including drought resilience and transparency over sewage spills.

If they score highly on some of these, they can get top marks even if they have spilled large amounts of human waste into England's rivers and seas.

The reforms being considered would mean that to achieve the new highest score, companies would not be able to have a low score for sewage discharges. This metric will also be tightened, the Guardian understands, so it is harder to achieve a good score.

Sources at the EA say it plans to add at least one extra star rating in an overhaul of the rules, so no company found to be spilling sewage will be able to call itself an "industry leader" to justify high CEO pay.